Importance of Considering Insurance When Getting Financial Planning

Insurance PolicyA lot of consumers do not spend a lot of time with insurance. Many simply buy insurance that is offered at work and perform little research. Unfortunately, having too little insurance or the wrong insurance can be a big financial mistake. For example, a lot of people do not buy enough life insurance. Although it is unlikely that a worker will pass away prior to retirement, it can be a financial disaster for a family if the main breadwinner dies. Many people find out they need life insurance after diagnosis of a terminal illness. Unfortunately, insurers won’t underwrite life insurance for those who have terminal illnesses. That is why it is important to get the right insurance at the right amount earlier rather than later. A financial advisor can help with getting the right insurance.

Health insurance is a major expense for both workers and retirees. Although the Affordable Care Act has made it easier for many to get medical insurance without having to worry about medical underwriting, costs are still rising faster than inflation. That is why it is important to factor in the high cost of healthcare when doing Financial Planning. An advisor will often recommend that a large chunk of monthly expenses to be dedicated towards medical costs including insurance premiums. As a result, many will need to save more money or postpone retirement. It is also important for advisors to make sure that clients are enrolled in the appropriate health insurance plans. Those who are healthy should probably choose high deductible policies. Those with a lot of health problems should choose low deductible policies even though they are a lot more expensive.

Another major insurance expense is homeowner’s insurance. Consumers need sufficient insurance to replace the improvements on their property. The policy limit should be the cost of replacing the structures on the property. It should not be based upon the value of the property, since that includes land. Land cannot be destroyed, so there is no benefit in insuring the land value.

Those getting planning services from advisors will go through this process for other types of insurance such as disability insurance, auto insurance, and more. Although insurance planning is a bit time consuming, it is well worth the effort since not having the right insurance can be very costly.

Read More

Importance of Choosing the Right Investments When Getting Financial Planning

An important part of successful Financial Planning is choosing the right investments. It can be confusing for many people when they are looking at various investment choices. Is it better to choose a money market fund or to choose an individual stock? What makes this process even more difficult is that the right choice will differ from person to person. The investment choices of someone who is in their 20s may be inappropriate for someone who is about to retire. It can be very helpful for many to get advice from a financial advisor when choosing the right investment.

When choosing investments for a client, the advisor will first figure out what financial goals the client wants to achieve. In most instances, there are several goals clients want to meet. Clients who have children often want to save money to help pay for college. Most need to save money in order to pay for retirement. Many younger clients and even some older clients want to save money for a down payment on a home. This information is used by advisors to figure out what investments are appropriate.

According to experts from financial planner winnipeg, If there are financial goals to meet that are within five years or less, it is likely that the advisor will recommend cash investments such as money market funds, certificates of deposit, and high yield savings account. Today, interest rates are quite low on safe investments. Clients should not expect a lot of investment earnings when choosing these investments. However, these investments are unlikely to result in a loss. The financial crisis that occurred in 2008 and 2009 showed that cash can potentially perform a lot better than other investments that suffered heavy losses such as stocks. Get retirement options and financial advice.

Those who are saving for goals that are more than ten years away may want to choose riskier investments such as stocks and bonds. Many choose to invest in a mix of both stocks and bonds. Those who do not want to choose specific stocks and bonds can choose from many mutual funds. The advisor will often recommend several mutual funds that clients should consider purchasing.

Most advisors find that a mix of investments works well to balance investment returns and risk. Most have both short term and long term goals for their money. An advisor can help client figure out what mix of investments is best for each client.

Read More

How to Select the Right Financial Adviser

It can be difficult to financially plan for the future. That’s why finding a good financial advisor as early in your life as possible is so important. Even if you haven’t planned in your 20s, it’s still a good idea to sit down and find out what your options are later on in life. Discovering the best ways to get out of debt, save or invest money, or create a plan to achieve a tangible goal works when you and your adviser are on the same page. The big question is how to find the best one for your particular situation.

Check for Credentials

The world of Financial Planning is not well regulated. However, there are organizations that will vet advisers for you. Instead of settling for someone with very little training, look for initials behind the name. A CFP has demonstrated solid financial planning knowledge by passing a test administered by the Certified Financial Planner Board of Standards. A program of continuing education is required to maintain this certification so the longer they have had it, the more experience your planner will have. If you are having trouble finding local assistance, check out the National Association of Personal Financial Advisers (NAPFA). They maintain a list of fee-only planner who are pledged to work in your best interests.

It’s a good idea to run a background check on the financial planner that you are interested in working with. If there have been problems in the past, you’ll get the red flag before you invest a single dime. While most financial planners work above board, there are few that are nothing but problems. An early warning is worth its weight in your hard earned gold.

Ensure That Your Planner Has Experience with Your Income Level

After financial advisers have been in the industry for a while, they may restrict their practice to people with significant investment dollars. Don’t worry about this too much. There are plenty of advisers willing to work with ‘beginners’ who have established a great track record. Ask your friends and family who have a stable investment plan who they work with and consider hiring that person as well.

 

Read More

How a Financial Planner Can Help You Grow Your Wealth

wealth managementAs your wealth grows, it can become more time-consuming to manage it. While you are busy working and making money, it is important to make sure your money is working for you. If you lack the expertise or the time to research the best ways to invest your money, an experienced personal financial planner can help you.

You don’t need to have millions of dollars to benefit from the services of a financial planner. It may even be better to establish a relationship with a financial advisor early in your career. When you begin making wise investments early, you have a better chance of having the money you need to send your children to college, retire comfortably and leave an inheritance to your heirs when you die.

Financial Planning can help you at any stage of wealth. Whether you are struggling to pay your credit card bills and need help preparing a realistic budget for your family to avoid bankruptcy or you have inherited a large sum of money and need help choosing the right way to invest so the money can be used as it was intended, a financial planner can help become financial secure.

Before you hire a financial planner, it is important to understand how they get paid. Some advisors are paid on commission. Some charge a flat or hourly fee. Others bill clients a percentage of the assets they manage. Many people prefer to pay a percentage of their assets because financial planners who use this fee structure have an incentive to grow their clients’ assets.

If you don’t know a lot about investing or you don’t want to take a lot of time to monitor your financial planner’s activities, choose an advisor who is a fiduciary. These professionals pledge to act in the best interest of their clients. A fiduciary must recommend investments that they know are right for you and will help you move toward your goals. Your advisor should take the time to understand your goals and hopes for your portfolio and take your individual needs into account as they manage your assets.

Get help from Craig Brockielos angeles financial advisor. Partner at Contrarian Advisors, he offers beverly hills wealth management services.

Read More

A Guide to Family Financial Planning

family financial planningFor most people, the way money is handled has a lot to do with upbringing. In some people, the accumulation of wealth fulfills a need for security, and for others, it is a path to adventure and excitement. Below, we will discuss how the environment in which you were raised may have helped to shape your financial outlook.

Family Finance Types

A family’s view on finances usually falls into one of the below categories, although some families blend two or more. These categories can be described as:

  • Conservative – Families take an analytic approach to decision making, moving cautiously and slowly before making investments. These families tend to guard every penny and take risk management very seriously.
  • Stable – This kind of family likes to keep things the way they are, and tends to resist situations that require rapid adaptability. Here, tradition is honored, and those who break from the norm are frowned upon.
  • Extroverted – This family financial culture focuses on harmony and relationship building. Families like these don’t pay much attention to the minutiae of financial decision making, and aren’t as inclined to adhere to procedures.
  • Entrepreneurial – Families like these are very focused on results, preferring to make financial decisions based on details. They move quickly once a decision is made, and work automatically to maintain autonomy and control.

The types described above are general, and children don’t always follow their parents’ example. In some cases, we do the opposite – for example, if your parents were very frugal, you may continue their penny-pinching ways, or buy what you want when the mood strikes.

Your Upbringing Shapes your Habits

In large families, you may see patterns regarding financial choices. Everyone has a financial family history, and in some cases, it’s so deeply ingrained that we don’t even realize it’s there. When we know more about this history, we can make conscious choices to avoid or reinforce related behaviors.

Starting the Conversation

To see how your spending habits can affect your future, you should talk to a Financial Planning firm. A financial advisor can give you common sense tips on having the “money talk” with your parents, children and spouse – no matter what financial culture your family has.

Read More